Apple Pay Faces Tough Market in China
Apple is pushing its payment platform the Apple Pay into Asia and Europe after launching it in China earlier. The Silicon Valley icon may be needing a bigger market as it is predicted by some to have a struggle in China, outside the United States, China is the obvious prime target country for Apple. Although Apple has a good name for software and hardware, a pair of local e-pay (electronic payment or online payment) rivals has already established a tough hold on the giant market.
Apple is working with China UnionPay to allow holders of the Chinese interbank debit cards pay bills on their iPhones and iPads. UnionPay now wants to make Apple Pay available in all major markets that now sell its gear, the service’s VP Jennifer Bailey says as cited in tech media reports.
The China UnionPay setup makes sense because 232 Chinese banks already issue those cards and some of Apple’s local rivals aren’t connected to the massive network. People with iPads and iPhones can put the debit cards in their electronic wallets to make payments. The iPhone commanded 14% of the Chinese smartphone market per data available earlier this year when Apple Pay made its Asia launch in China. But local challengers Alipay, run by the giant Alibaba e-commerce empire and WeChat Pay under Internet content provider Tencent have gained favor fast without the UnionPay connection because they’re so universal.
Some Chinese have supported on social media for Apple Pay’s connection to the bank cards, this means that there will be no need to register for accounts as required by Alipay and WeChat Pay, says Danny Levinson, a Beijing-based technology angel investor. The incumbents(Alipay and WeChat) may want Apple Pay out of China if that support grows, he adds. “There could be protectionist roadblocks for Apple Pay in the future if the service appears to cut into Chinese competitors’ revenue,” Levinson says. “Anything could happen, so Apple is balancing the considerable risk with the potential high reward of entering China with its payments platform.”
Source: Forbes Tech
Apple is working with China UnionPay to allow holders of the Chinese interbank debit cards pay bills on their iPhones and iPads. UnionPay now wants to make Apple Pay available in all major markets that now sell its gear, the service’s VP Jennifer Bailey says as cited in tech media reports.
The China UnionPay setup makes sense because 232 Chinese banks already issue those cards and some of Apple’s local rivals aren’t connected to the massive network. People with iPads and iPhones can put the debit cards in their electronic wallets to make payments. The iPhone commanded 14% of the Chinese smartphone market per data available earlier this year when Apple Pay made its Asia launch in China. But local challengers Alipay, run by the giant Alibaba e-commerce empire and WeChat Pay under Internet content provider Tencent have gained favor fast without the UnionPay connection because they’re so universal.
“An optimist could argue that Apple has enough brand cachet in China that a small segment of some high-end users might give Apple Pay a try, but the reality is that, it’s going to be an ultimately big challenge for them given the dominating presence that Alibaba and Tencent have there,” says Bryan Ma, client devices vice president with market research firm IDC Asia-Pacific and Worldwide.Alibaba and Tencent have gained a following because even small shops that don’t take credit cards often accept Alipay or WeChat Pay, says Mark Natkin, managing director with market research firm Marbridge Consulting in Beijing. Business men and women at those shops allow customers scan printouts of 2D barcodes matching their own accounts, he says, and Apple Pay to win people over they must offer something significantly easier or more secure.
Some Chinese have supported on social media for Apple Pay’s connection to the bank cards, this means that there will be no need to register for accounts as required by Alipay and WeChat Pay, says Danny Levinson, a Beijing-based technology angel investor. The incumbents(Alipay and WeChat) may want Apple Pay out of China if that support grows, he adds. “There could be protectionist roadblocks for Apple Pay in the future if the service appears to cut into Chinese competitors’ revenue,” Levinson says. “Anything could happen, so Apple is balancing the considerable risk with the potential high reward of entering China with its payments platform.”
Source: Forbes Tech
Its Going to be tough
ReplyDelete